Tata Consultancy Services Plans Major Layoffs: What You Need to Know
TCS Announces Significant Workforce Reduction
Mumbai: Tata Consultancy Services (TCS), a leading IT firm, is reportedly set to reduce its workforce by approximately 12,000 employees in FY26 as part of a significant restructuring initiative, according to various reports released on Sunday.
This decision will impact around 2% of TCS's global workforce, with the goal of preparing the company to be more agile and ready for the future amid rapidly changing technologies and workplace dynamics.
As of June 2025, TCS employed 613,000 individuals, and the layoffs will be executed across different sectors and regions.
The majority of those affected are anticipated to be in middle and senior management positions. Sources indicate that this move is not primarily motivated by cost-cutting or automation, but rather by difficulties in reallocating talent whose current roles do not meet the company's evolving skill needs.
TCS is concentrating on the extensive implementation of artificial intelligence (AI) and other innovative technologies that are transforming demand within the IT industry.
While TCS has stated that AI is not directly displacing jobs, analysts suggest that positions such as manual testing are diminishing, and some senior employees are finding it challenging to adjust to new, technology-driven environments.
To assist those impacted, TCS is providing severance packages, extended insurance, notice period compensation, and support in securing new job opportunities, as reported.
This announcement follows TCS's recent report of a net profit of ₹12,760 crore for Q1 FY26, marking a 6% increase year-on-year.
Operational revenue grew by 1.3% to ₹63,437 crore during the April-June quarter, and the company also declared an interim dividend of ₹11 per share.
CEO K. Krithivasan credited the company's consistent performance to robust deal closures and an increasing demand for new services, despite ongoing global economic and geopolitical uncertainties affecting client expenditures.
He also emphasized TCS's continuous investments in the AI ecosystem, which includes infrastructure, data platforms, and business applications.
Currently, TCS has over 114,000 employees trained in advanced AI skills, and during the last quarter, employees dedicated 15 million hours to enhancing their knowledge in emerging technologies.